The CALIFORNIA ASSOCIATION OF REALTORS® on Tuesday issued a statement lauding the Federal Housing Finance Agency’s (FHFA) announcement to increase the 2018 conforming loan limits for mortgages acquired by Fannie Mae and Freddie Mac to $453,100 on one-unit properties and a cap of $679,650 in high-cost areas. The previous loan limits were $424,100 and $636,150, respectively.
“C.A.R. applauds the FHFA for recognizing California’s continuing home price increases over the last few years and raising maximum conforming loan limits,” said C.A.R. President Steve White. “Increasing the existing Fannie Mae and Freddie Mac conforming loan limits will provide stability and certainty to the housing market and give tens of thousands of California home buyers a chance at home ownership.”
The conforming loan limit determines the maximum size of a mortgage that government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac can buy or “guarantee.” Non-conforming or “jumbo loans” typically have tighter underwriting standards and carry higher mortgage interest rates than conforming loans, increasing monthly payments and hampering the ability of families in California to purchase homes by making them less affordable.
